We can take practical measures to reduce oil imports

BILL WHITE, HOUSTON CHRONICLE

Published 6:30 am, Friday, February 25, 2011

The turmoil in Libya and its impact on oil prices and financial markets should remind us that America must make our energy supply more secure and sustainable. In the last election, both presidential candidates vowed to reduce oil imports and support cleaner fuels. We cannot afford partisan gridlock preventing the progress we need. There are practical steps we could take to reduce oil imports and encourage domestic fuels, including cleaner fuels.

American vehicles consume the vast majority of imported oil, so we must start with more efficient use of fuel to begin curing what President George W. Bush called our "addiction to foreign oil." Fortunately, we know what works. Fuel economy standards improved auto miles per gallon by 70 percent during the period from 1975 to 1985. Then progress halted. In 2007 Congress authorized new standards and last year the Obama administration set goals equivalent to 34 miles per gallon for new vehicles in 2016. New goals should be extended through 2020, raising fuel economy to greater than 40 mpg. Strong fuel economy standards also encourage use of alternative fuels, further reducing oil imports.

We can also reduce fuel use and costs with more efficient transportation of freight. We should learn from the success of Wal-Mart Stores Inc., which set bold annual goals to achieve dramatic improvements in fuel efficiency in its trucking operations. We must also remove the bottlenecks from the freight rail system and encourage the use of inland waterways to transport freight at a fraction of the fuel use of trucking.

Coal supplies almost half of U.S. electricity, and many old coal plants emit large amounts of conventional pollution as well as greenhouse gases. Our nation has a great opportunity to phase in cleaner fuels, starting with soaring supplies of natural gas, which could replace a quarter of existing coal-fired power. Waste heat and wind and geothermal sources can double their contribution to electricity supply in less than a decade. The cost of solar power is falling. Regional grids should be charged with responsibility for developing plans giving cleaner fuels a defined priority when the grids dispatch power. Requiring grids to phase in cleaner power, using reasonable economic and emissions criteria, requires no new taxes or fuel-specific quotas.

We need to revive responsible offshore drilling, to displace imports and preserve domestic jobs. The U.S. economy benefits enormously from jobs resulting from American expertise in offshore operations, and we should not risk losing this leadership and the related high-wage jobs to other nations developing their offshore resources. New onshore drilling practices, using horizontal wells and environmentally sound fracturing of oil shale formations, can result in substantial new domestic oil supplies, without the threat of import disruption.

Global warming skeptics should not allow their beliefs to block energy policies that reduce imports and create new jobs. After all, before 2000, bipartisan federal policies helped replace a significant amount of coal-fired power with cleaner natural gas and nuclear sources, without reference to carbon emissions. State governments, including Texas', proved the viability of reasonable, phased goals for the use of renewable resources more than a decade ago, so this is hardly some radical idea.

By the same token, critics of oil companies should understand that new U.S. production preserves high-wage domestic jobs while reducing the risks of imports, upward pressure on prices and tanker spills. Over the last two decades large U.S. energy companies have realized returns on shareholders' equity and corporate assets lower than the average of other major corporations. People should also remember that the greatest environmental tragedy in the oil patch occurred when Iraq torched hundreds of Kuwaiti wells, the type of risk avoided by domestic production.

Energy policy, like other national security concerns, should transcend ideology. President Obama made creating new energy jobs a centerpiece of the State of the Union address, to the applause of members of both parties. President Ford 35 years ago also sought common ground by making cleaner domestic energy the focus of his State of the Union address after a bitter election in the wake of Watergate. Working in Congress as a young legislative assistant in those days, I witnessed members of Congress from both parties working together to craft bipartisan legislation encouraging domestic production, funding new technologies and creating both the Strategic Petroleum Reserve and national standards for more energy efficient cars and other products. We need that spirit of urgency today.

It usually takes a crisis to raise energy policy to the top of the national agenda. The events leading up to 9/11 and the collapse of the housing market should have taught us the virtue of acting before a looming crisis. Riots in the streets of Libya, a large oil exporter, offer stark proof that energy risks are real.

White, a businessman, served as U.S. deputy secretary of energy and mayor of Houston.